USAA survey finds boomers are stuck in their ways

A survey of 1,259 adults between 45-64 years old conducted by USAA found that 73 percent of baby boomers who own an IRA are not planning to convert their Traditional IRA to a Roth IRA in 2010, which is when the household limit of $100,000 in modified adjusted gross income is scheduled to be lifted. Any investor who converts in 2010 can pay the tax bill over a two-year period.

Why in the world is this important?

“There may never be a better time than in 2010 to create a tax-free income stream for retirement,” Terri Kallsen, senior vice president, USAA Wealth Management, said in a release. That’s why.

“The combination of lower account values, historically low income-tax rates, conversion income limits lifting and the ability to pay the tax bill over two years provides a rare opportunity to potentially increase your income in retirement by hundreds, and even thousands, of dollars each month by eliminating taxes through a Roth IRA,” she said.

Any way you can eliminate taxes is a good way. So, now that you’re aware, get out there and do something about it.